CBN develops short loan access rules for banks

The Central Bank of Nigeria (CBN) has introduced new rules on how banks can access loans from its discount window on auction days.

These rules were contained in a circular released at the weekend and signed by the CBN Director of the Financial Markets Department, Mrs. Angela Sere-Ejembi.

The CBN discount window includes the Standing Lending Facility (SLF), the Automated Repo Conversion (AREPO), the Funding for Liquidity Facility (FfLF), and the Tenored Repurchase Transactions (REPO).

The SLF is an overnight CBN credit available on banking days between 2 p.m and 3.30 p.m, with settlement done on same day value.

The CBN said: “Open Market Operations: Participants with successful bids at the Open Market Operations (OMO) auctions are to refrain from accessing the discount window on the auction date. Failure to comply shall result in the reversal of allotment.

“Government Securities: Participants with successful bids at the government securities auctions such as Nigerian Treasury Bills (NTBs), Federal Government of Nigeria (FGN) Bonds, and Sukuk are not permitted to access the CBN discount window on the settlement date.

Requests for SLF, FfLF, and REPO on the settlement date will not be permitted.”



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